Published 6:30 am, Thursday, January 6, 2011

Alleged Ponzi scheme leader R. Allen Stanford has been held in federal custody without bail.

Alleged Ponzi scheme leader R. Allen Stanford has been held in federal custody without bail.

Photo: F. Carter Smith, Bloomberg

Federal judge orders detox for financier R. Allen Stanford

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Accused swindler R. Allen Stanford cannot be tried until he undergoes detoxification from addictions to medications he's received in jail, a federal judge said on Thursday, delaying indefinitely a trial that had been scheduled to begin Jan. 24.

U.S. District Judge David Hittner made the ruling after a day of testimony in which three psychiatrists, including one hired by the government, testified that Stanford takes heavy doses of anti-anxiety and anti-depressant drugs that render him incompetent to stand trial on charges of running a $7 billion Ponzi scheme.

"He is unable to work effectively and rationally with his attorneys in his defense against the charges," psychiatrist Victor Scarano testified during a daylong hearing.

Hittner ordered lawyers to file motions by Wednesday on whether Stanford should be released for detoxification in a private Houston facility. He has been in federal custody without bail as a flight risk since he was indicted in June 2009.

Ali Fazel, one of Stanford's lawyers, told the judge that Stanford's parents have offered to put up all their property as security and that Stanford could wear an ankle monitor while in detox and then move into an apartment while working with his lawyers on his case.

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Government lawyers recommended that Hittner send Stanford to an out-of-state specialized prison hospital that has experience with drug addiction.

Fazel noted that Stanford has been assaulted while in federal custody, and that prison doctors prescribed the medication to which he's now addicted. "It's the government that caused the problem," Fazel said.

Triple the normal dose

Scarano testified that for a year, the former head of Houston-based Stanford Financial Group has been taking 3 milligrams a day of the anti-anxiety drug clonazepam, and that a normal dose is up to 1 milligram a day for no longer than two weeks.

He also takes the antidepressant mirtazapine, said Scarano, who was hired by Stanford's team.

The anti-anxiety medicine causes Stanford, 60, to suffer drowsiness, lack of energy and inability to focus on tasks, Scarano said.

In cross-examination of Scarano, Assistant U.S. Attorney Gregg Costa noted that Stanford spoke coherently and rationally when he represented himself in a hearing last spring before U.S. District Judge Nancy Atlas.

Alleged brain injury

Scarano countered that Stanford complained in that hearing about his treatment in custody but did not present legal arguments.

"This is a man getting up complaining he's not being treated right," Scarano testified.

Scarano said Stanford suffered a brain injury when he was assaulted by another prisoner in September 2009, but the psychiatrist said he couldn't determine whether any of Stanford's symptoms result from the trauma rather than his depression or addiction.

Scarano estimated that it would take three to six months to wean Stanford off the anti-anxiety medication, including an initial two to four weeks at an in-patient medical facility.

But Daniel Fox, a psychologist who works at the downtown federal detention center, where Stanford is being held, said he believes Stanford is competent for trial.

Under cross-examination by Stanford defense lawyer Robert Scardino, Fox said he was not familiar with Stanford's medical history and did not base his assessment on an independent evaluation of Stanford's condition.

Psychiatrist A. David Axelrad testified that he examined Stanford on Tuesday, and believes he needs detoxification from his medications, followed by a neuropsychological assessment, to determine his competence for trial.

'Not a malingerer'

Axelrad and Andrew Warren, a federal prosecutor from Washington, engaged in a heated exchange after Warren suggested Stanford was faking his symptoms. The psychiatrist replied that he's been examining patients since 1971.

"This man is not a malingerer," said Axelrad, who was hired by Stanford's lawyers.

Another psychiatrist, Steven Rosenblatt, hired by the government, testified that Stanford is suffering from delirium, likely brought on by the medication.

Stanford appeared in a green prison uniform and under heavy security of U.S. marshals.

Stanford and other former executives in his network of companies are accused of defrauding investors, mostly through certificates of deposit issued by a Stanford-owned bank on the Caribbean island of Antigua.